Greenback strikes greater, markets put together for Fed

Dollar gains ground vs. other majors, all eyes on Fed decision

Investing.com – The dollar moved higher against the other major currencies on Tuesday, supported by the release of positive U.S. economic reports and as markets awaited the Federal Reserve’s highly-anticipated policy decision on Wednesday.

gained 0.40% to 121.52.

The U.S. Commerce Department reported that were unchanged from a month earlier, meeting expectations and following a gain of 0.2% in October.

Year-over-year, were 0.5% higher from the same month a year earlier, compared to expectations for a 0.4% increase and after rising 0.2% in October.

, which excludes food and energy costs, increased by 0.2%, meeting expectations.

Separately, the Federal Reserve Bank of New York said that its improved to -4.6 this month from a reading of -10.7 in November. Analysts had expected the index to rise to -6.0 in December.

Market participants awaited the Federal Reserve’s highly-anticipated policy decision due on Wednesday. Most investors expect the Fed to raise interest rates for the first time since June 2006.

dropped 0.54% to 1.0934, after hitting highs of 1.1060 earlier in the day.

Earlier Tuesday, the ZEW Centre for Economic Research said that its rose by 5.7 points to 16.1 this month from November’s reading of 10.4. Analysts had expected the index to rise by 4.6 points to 15.0 in December.

Elsewhere, the dollar was higher against against the pound and the Swiss franc, with down 0.47% at 1.5069 and with rising 0.39% to 0.9889.

Sterling found support after the U.K. Office for National Statistics said the rose by 0.1% last month, in line with expectations and up from -0.1% in October.

Month-over-month, was flat in November, compared to forecasts for a 0.1% decline and following a gain of 0.1% in the prior month.

, which excludes food, energy, alcohol, and tobacco costs rose 1.2% last month, matching forecasts and up from 1.1% in October.

The Australian dollar was weaker, with down 0.86% at 0.7185, while held steady at 0.6758.

The Reserve Bank of Australia said earlier, in , that the domestic economy is strengthening and noted that overal business conditions and the employment market looked healthy.

However, in its mid-year economic and fiscal outlook, Australia’s Treasury said growth forecasts were downgraded to 2.5% in 2015/16 from a previous estimate of 2.75% in May and to 2.75% in 2016/17 from 3.25%.

Meanwhile, was almost unchanged at 1.3737, off lows of 1.3674 hit earlier in the session.

In Canada, data showed that dropped 1.1% in October, compared to expectations for a 0.5% fall, after a 1.5% decline the previous month.

The , which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.40% at 98.13, after falling to lows of 97.23 earlier Tuesday.

Greenback strikes greater, markets put together for Fed